Masdar and Scotland take renewable vows

Scotland is hoping to raise its game on the clean energy front via a deal that promises close ties with innovative power company Masdar of the United Arab Emirates (UAE).

By Sam Phipps in Edinburgh

The agreement, recently signed by first minister Alex Salmond at the World Future Energy Summit in Abu Dhabi back in January, will provide vital investment and development opportunities, including R&D in wind turbine development, according to the Scottish government.

An alliance of 12 Scottish universities – the Energy Technology Partnership (ETP) – will co-ordinate research on the European side, uniting about 250 faculty members and 700 researchers, while the Masdar Institute of Science and Technology will drive the scheme in the Middle East.

Dr Sultan Al Jaber, CEO of Masdar, said the UAE and Scotland, with its “abundant, untapped natural resources”, shared a similar vision for renewable energy. He cited Scotland’s commitment to ensuring that at least 100% of its electricity needs came from renewable energy by 2020, with surplus power being exported.

Investment opportunities

Offshore Scottish wind projects will provide a total of £30bn in investment opportunities in the next 10 years, according to Scottish Enterprise (SE). Three investment schemes will identified for Masdar within 12 months, and, if the project bears fruit as expected, more will follow.

Masdar will also participate in SE’s goal of cutting up to a fifth of the costs of offshore wind by utilising oil and gas supply chain technologies and skills. This would be achieved by Masdar forming strategic partnerships with Scottish contractors, and, partly to this end, personnel will be visiting Scotland in the first quarter of 2012.

SE has already pledged seed funding of £20,000 over three months to support Scottish academics in exploratory discussions with Masdar Faculty.

The Scottish Government has repeatedly stated a desire to attract turbine manufacturers to the country. It set up the £35m POWERS (prototype offshore wind energy renewables support) fund last September, with the aim of leveraging up to a further £80m of private investment and bringing the production of full scale prototypes to Scottish sites.

Tom Lamb, senior manager in renewable energy and low carbon technologies at SE, said the Masdar relationship made sense because the company was already making significant investments in markets outside the UAE. Masdar is heavily involved in the London Array offshore wind project and is ambitious to invest further in the UK.

“Masdar is a very attractive partner because its basic premise is to invest in and develop low carbon technologies,” Lamb said.

“But we have deliberately taken a different route to typical R&D partnerships which tend to opt for a basic budgetary/financing approach - we bring £xx to the table, you match fund that and only then do we look for the R&D projects to do. But that way, once the money and the projects are finished that’s the end of the partnership. We want to forge much longer term relationships.”

Instead, creativity and innovation is key, and funding can be worked out later. “The immediate thing we aim to do is establish contact, get people working together through exchange of people and ideas.”

Free hand

Though energy policy as a whole is a matter reserved to Westminster, some aspects are devolved, including renewable energy, which means that Scotland has considerable autonomy in terms of renewable energy generation targets and support for technology development.

Scotland’s First Minister, Alex Salmond, has raised Scotland’s profile in the renewables sphere, with emphasis on inward investment and networking. Edinburgh has hosted the Scottish Low Carbon Investment Conference for the last few years.

About 700 wind turbines are planned for UK waters in the next decade, with a large chunk of these earmarked for Scottish waters. In the last year, power system manufacturers Mitsubishi, Samsung and Gamesa have all announced plans to develop next generation offshore wind turbine technology in Scotland.

Expertise from the North Sea oil and gas industry is likely to prove invaluable for the installation and maintenance of wind turbines and can considerably reduce costs.

For example, DPS (dynamic positioning system) vessels, which are used routinely in offshore offshore oil and gas operations, are, on the face of it, expensive, Lamb said. Yet offshore tidal turbine operators are increasingly becoming aware of their cost effectiveness too. The alternative – crane barges waiting on standby for a weather window – can be considerably costlier.

Masdar has a number of investment funds, which take shares in hi-tech companies and SE has a similar role, Lamb said.

Asked how much of the renewables market Scotland could eventually expect Masdar to take, he said it was impossible to quantify. “There’s a market opportunity here. We hope this partnership will result in sustained interest from Masdar – the extent of their engagement will be their decision over time.”

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